If you’re heading on holiday in the near future, but are a bit uncertain about investing in holiday insurance, you’re not alone. While many travelers wouldn’t dream of vacationing abroad without trip insurance, it can be a confusing consumer milieu. We’ll briefly outline available coverage options to help you decide whether holiday insurance is an appropriate addition to your vacationing budget.

Holiday insurance is designed to provide reimbursement for expenses incurred in cases of emergency or unforeseen circumstance while vacationing abroad. You may purchase travel insurance policies that provide repayment fora wide variety of circumstances, such as:

• Baggage theft, loss, or damage
• Loss or theft of cash or credit cards
• Hotel and transportation expenses arising out of trip delays, missed flights, or other transportation cancellations
• Costs related to replacing a passport
• Legal expenses and liability coverage in the unfortunate event you are involved in a situation resulting in property damage or personal injury to others
• Compensation in the event of death or disability incurred while on holiday
• Costs arising out of medical emergency
• Trip cancellation due to natural disaster or political unrest
• Failure of a travel provider fulfilling their contractual obligations to you, such as a transportation company going out of business at the last moment
• Trip cancellation due to illness
• Medication replacement due to loss or theft

This list is not exhaustive, and not every holiday insurance company provides coverage for each of these eventualities, so it is best to thoroughly understand the trip insurance policy you purchase before leaving on holiday.

Another set of insurance options relates to the frequency with which you travel abroad.  If you plan a single annual holiday, one-trip insurance (eg, an insurance package covering just one holiday) is likely best for you.  But if you find yourself traveling more than once per year, an annual holiday insurance policy might be more appropriate for you.  You’ll reap a savings over purchasing individual trip insurance packages for each of your excursions (whether for business or leisure), and you’ll only have to purchase holiday insurance one time during the year.  Most policies can be renewed on an annual basis, as well.

Travelers rarely anticipate significant inconvenience or difficulty, but for most, the marginal additional cost of holiday insurance is more than offset by the savings realized by being insured for just a single unfortunate event abroad.  Even a single night’s extra hotel stay, or last-minute ticket purchase, can be a significant expense.  Having holiday insurance coverage can provide peace of mind during stressful circumstances, and prevent unplanned travel expenses busting your budget.